This is a rough, lackluster to mediocre at best quarter for many insurance companies that I own and follow; GNW CNO HIG MTG MBI HIG TRV ORI. We are not alone.
They have for the most part traded down, post earnings. Today GNW might have received the prize.
Granted all are unique and have different reasons but there is still an underlying theme of low interest rates and as financial sector stocks, WS seems to be viewing them ----out of favor.
Bottom line, give it time. Management will sort this out and produce a favorable LTC product that is safe and profitable down the road. If not, he should know enough to eliminate the division. Interest rates will also eventually rise.
RPS - I always look forward to your FWIW posts ... almost as if it's your trademark ... anyway you're right about the insurance sector en total getting hammered. CNO picked up a few cents today though after getting hammered in the past few days.
Good to read your posts - always measured and thoughtful even on days like this one.
We have a Genworth LTC policy which has never had a premium adjustment in the nearly 10 years we've owned it. If they raise the rates on us this year, I'll grin and bear it, while accepting that as a sign of fiduciary responsibility on behalf of GNW management.
Over the last three years I keep hearing more and more about small international insurance companies getting bought, the Schwab equity book rating is way over the bid, I'm waiting for some Chinese company that wants to enter Australia to follow their mining interests and be happy to get the Canadian and U.S. assets as a bonus...but what do I know...
Rate hikes will take care of the problem much older LTC policies. There's only a small percentage and they were badly packaged. Many will drop their coverage as a whole due to rate increases. Sorry for them, good for GNW.
This drop is way overdone. But hey, if you had dry powder, it's perfect.